In line with trend in developed markets, Indian commercial vehicle OEMs are witnessing growing adoption of connectivity features, CASE, sustainability and digitisation. A report on CII's Indian CV Conclave held in New Delhi.
20 Jul 2023 | 7810 Views | By Mayank Dhingra
The commercial vehicle (CV) segment, which is the barometer of an economy and an indicator of the health of its automotive industry, is currently witnessing massive transformation in India in line with the rapid changes underway in its logistics sector.
The e-commerce boom, which has goods being delivered rapidly ...
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The commercial vehicle (CV) segment, which is the barometer of an economy and an indicator of the health of its automotive industry, is currently witnessing massive transformation in India in line with the rapid changes underway in its logistics sector.
The e-commerce boom, which has goods being delivered rapidly in every nook and corner of India through last-mile mobility, is proving to be a huge growth catalyst for the CV industry. This was the core topic of the ‘Indian Commercial Vehicle Conclave’, organised by the Confederation of Indian Industries (CII) in New Delhi on July 20. The well-attended event saw industry leaders and experts deliberate on current challenges and future opportunities for the CV industry, which is expected to grow at a CAGR of 8 percent by 2028.
The focus of the second edition of the CII Indian CV Conclave was on the CASE (Connected, Autonomous, Shared and Electric) megatrend, while also highlighting sustainability and digitisation as the core areas of action for the domestic CV industry. According to Girish Wagh, Executive Director, Tata Motors, "While CASE has revolutionised the passenger vehicle segment, it is now gaining momentum in the CV space. OEMs are actively charting their product strategies while keeping the CASE megatrends, which offer immense potential to transform the segment."
"Commercial vehicles in India are increasingly witnessing growing demand for connectivity features since the BS-VI switchover. With ADAS and autonomous driving technology to enhance safety, we need to develop them by virtue of collaborations or in-house," he added.
Wagh, who was the chief guest at the day-long conclave, also pressed upon an increasing level of digitisation, which is opening new business opportunities for the CV industry. "Digitisation of transactions is leading to the generation of data, and with data analytics, we will offer end-to-end solutions to customers," he said.
Touching upon sustainability, Wagh said that the CV industry needs to contribute to India's net-zero targets, focus on circularity, and also preserve the nation's biodiversity. "Commercial vehicles presently account for 18 percent of the overall carbon-dioxide emissions in India, and the industry is working on various technologies like electrification, alternate fuels, and hydrogen," he said.
Wagh added that with the harmonisation of regulations, growing electrification and increasing technology penetration, the Indian CV industry has the potential to tap global opportunities as well. "The CV industry contributes about 8-10 percent of India's GDP, and as India continues to be the fastest growing economy in the world, we are liable to shape the direction of this growth," he said.
Need for all-encompassing synergies
Anjali Singh, Chairperson, CII Haryana and Executive Chairperson, Anand Group, said, "The CV sector is undergoing massive transformation globally and India is not an exception. The transformation is pervasive across the industry and much of it is being driven by Industry 4.0 and the continued digitisation of the entire value chain. Online retailing, logistics services along with implementation of BS-VI emission norms, have significantly transformed the sector."
"In the coming years, the CV industry is likely to register faster growth in the BRIC countries, Asia, Latin America and South Africa. While these markets demand high reliability, the focus is not so much on comfort features in these heavy-duty vehicles. We in India must change this mindset, and aim to offer more features while ensuring reliability and cost competitiveness," Singh added.
Deepak Jain, Chairman, CII Northern Region and CMD, Lumax Industries, said, "The automotive industry is transforming not just in India but globally and we are finding new ways of offering sustainable mobility for 1.5 billion people in the country. The government, through the various PLI schemes, and localisation initiatives, has done well on the policy front.
"With vehicles becoming more connected, our supply chains also need to come together. Lightweighting, electrification as well as electronification are huge opportunity areas, and while we lag behind certain countries in electronics, we will need to increase our localisation in these areas. India has great component manufacturers as well as software providers, and the time is right for the two to come together and offer value-added solutions to the customers," Jain said.
Focus on enhanced safety in CVs
Vinod Aggarwal, President, SIAM and MD & CEO, VE Commercial Vehicles, said that with the Indian economy projected to grow from the current US$ 3.5 trillion to US$ 5 trillion by 2030, the future of the CV industry is extremely bright as the movement of goods and services will be done by these vehicles. Agarwal also talked about the industry's swift adoption of international standards, for instance, safety standards with improving infrastructure.
"India is adopting world-class standards such as ABS, roof and cabin crash norms, rollover protection for CVs, along with speed restrictions. Improving productivity will require enhancing driver comfort and convenience, and that is where AC cabins are being talked about. With respect to connectivity, the technology allows OEMs to offer preventive maintenance and fuel efficiency savings to fleet operators by tapping into the driving behaviour of truck drivers," Agarwal said.
Sandeep Kalia, MD, Valvoline Cummins suggested that for heavy-duty long haulage vehicles with diverse duty cycles and applications that are not best served by BEV platforms. Hydrogen seems to be a better choice than battery power. Kalia revealed how the lubricants major is now working on heat-transfer fluids with the changing propulsion technologies in commercial vehicles.
The Indian CV Conclave saw a host of industry leaders actively network, share perspectives and plot a course of action to determine the path to sustainable growth for this segment of the Indian automotive industry.
CV industry cautiously optimistic about growth
Just when it seemed the CV sector was cruising along at a good pace, given that it closed FY2023 with 34% growth and close to a million units, combined M&HCV and LCV sales in the first quarter of FY2024, at 217,046 units, are down 3% year on year (Q1 FY2022: 224,488 units).
While passenger carriers (buses), both M&HCV and LCV, have seen strong demand, the slackened demand for goods-transporting CVs in both sub-segments has proved to be drag on the overall segment. Combined LCV & M&HCV goods carrier sales at 191,669 units are down 6.5% on year-ago sales of 205,022 units. Commenting on the CV industry’s Q1 FY2024 performance, SIAM president Vinod Agarwal had said: "That does not pose any major concerns as we are expecting the Indian economy to grow very well in the medium to long term.”
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